Since Phase 2 of the Ministry of Heavy Industry’s FAME policy for electric vehicles (EV) is ending in 2024, there is anxiety in the market regarding the uptake of EVs. In this context, a Parliamentary Committee has suggested not to scrap it entirely but extend it by two years to address concerns and uncertainty in uptake and the instability of all the new start-ups in the industry that may have to shut down.
The FAME subsidy(s) have led to a significant rise in sales and start-ups in its nine years of existence. However, the subsidy has failed to produce an organic and indigenous supply chain in the country.
Moving forward, it would be interesting to see how EV subsidies are designed to address this issue, given India is considered a leader in automobile manufacturing.